Solar policy pits govt against public

Solar power generation has proven to be socially acceptable, economically viable and environmentally friendly. It is therefore highly sustainable for a country like Pakistan where the power supply gap is always increasing.

Solar can reduce our heavy reliance on expensive imported fossil fuels. It can also mitigate high electricity tariffs and bridge the existing 10% energy supply gap for the household sector.

Pakistan embarked on solar power after developing its net metering policy almost a decade ago. The policy proved highly successful in terms of increased solar panel installation amid tariff reduction by the National Electric Power Regulatory Authority (Nepra) from Rs27 per unit to Rs10 per unit.

The prime objective of the solar policy was not only self-reliance in power but shifting the power production cost from the government to consumers themselves. Consumers installed the solar panels and the government is buying this power without spending any upfront cost on constructing dams for hydropower or heavy spending on fossil fuel imports, including their recurring costs.

This has proven to be the cheapest source of power for the government. But instead of encouraging it, the government has slashed its price from Rs27 to Rs10 – a 65% reduction. All over the world, solar and other such indigenous sources of power are highly encouraged and rewarded.

Solar power provides an alternative to grid electricity. It offers a decentralised energy solution, which is especially important for remote areas in regions like the northern mountainous parts of Khyber-Pakhtunkhwa, Balochistan, Sindh and rural Punjab, where access to the grid is limited.

Being a clean and renewable source of power, solar helps reduce Pakistan's carbon footprint and dependence on polluting power generation. It also helps earn carbon credits for replacing power generated from fossil fuels that emit greenhouse gases.

Pakistan can achieve its committed power and energy generation from renewable sources by 2030 under the Nationally Determined Contributions (NDCs) to the United Nations Framework Convention on Climate Change (UNFCCC). Solar power has greatly helped Pakistan fulfil its obligation under the UNFCCC and comply with the targets of various Sustainable Development Goals. Solar offers energy security as an indigenous source and is equally important for fulfilling our international commitments.

Federal Power Minister Awais Leghari has emphasised the crucial role of solar energy in the country's energy mix, highlighting a strategy that leans heavily on indigenous resources. He said Pakistan is producing 74% indigenous power generation and has therefore increased its reliance on local sources – including solar, wind, hydro, nuclear and local coal – to strengthen energy security.

He further said the government aims to raise the share of indigenous energy to over 96%, moving toward a 90% clean energy mix by 2034. While this has been advantageous for consumer self-consumption, it has created challenges for the national grid. This has prompted the government to shift from net-metering to a net-billing system, which offers lower rates (about Rs10 per unit) to producers compared with previous rates.

The debate is that the government buys electricity at a low rate and sells it at a significantly higher rate - for example, Rs10 versus Rs60 per unit. While the exact figures vary based on generation type (hydro versus thermal) and time, the core issue is the widening gap between generation cost and the end-consumer tariff.

A large portion of the bill goes towards "capacity charges" paid to independent power producers (IPPs). These charges are paid even if the power is not produced or utilised. The government charges consumers to cover its failure to manage the financial crisis, including the interest on loans taken to manage circular debt. Consumers also pay for "line losses" which include electricity theft and inefficiencies in the grid.

The government's financial sustainability of the power sector clashes with the public's ability to pay. This has led to widespread protests and excessive inflation on electricity bills. The core conflict is that the government is locked into long-term, high-cost agreements with IPPs, often referred to as a "take-or-pay" model, where the burden is passed on to the consumer.

This is a vicious cycle that the government is now trapped in. It is greatly affecting all sectors of the economy and the public at large. Unfortunately, the public sector's resources are not limited, nor do the professionals in this sector possess any dynamism or innovative thinking to address these ever-increasing issues scientifically. The solutions so far are based on an unjust and unacceptable foundation.

Until a justified solution and mechanism is devised, these issues may persist. Both the government and society may continue to feel their impacts. Consequently, the public is very much against the existing tariff and taxes loaded into their electricity bills.

On the other hand, the government has completely ruined the solar net metering policy. It is pushing the public that already has solar panels to switch to off-grid solar power generation. This will lead to irregular and unrecorded power generation that may not give any benefit to the public in the longer term.

The government, on one hand, is favouring IPPs at the cost of power consumers. It is ignoring international commitments to various legally binding conventions like UNFCCC, Agenda 2030, INDCs and SDGs. This may negatively impact Pakistan's image at the international level. It will also affect self-reliance in power at no upfront and recurring cost on power production.

THE WRITER HOLDS A PHD AND A MASTER'S DEGREE IN FOREST MANAGEMENT. HE HAS SERVED THE K-P FORESTRY DEPARTMENT AS DIVISIONAL FOREST OFFICER AND HAS ALSO SERVED AS HEAD OF PAK-EPA